September 26, 2018 . 5 min read
Storecoin’s DyPoS does it with a leaderless consensus algorithm and equitable incentive model
1/ The paper, "Formal Barriers to Longest-Chain Proof-of-Stake Protocols" by Jonah Brown-Cohen, Arvind Narayanan, Christos-Alexandros Psomas, and S. Matthew Weinberg assumes PoS blockchains are "similar" to PoW, except for wasted energy associated with the latter.— Chris McCoy (@chrisamccoy) September 25, 2018
2/ In other words, they assume PoS blockchains that are leader-based, similar to PoW's method of choosing the winning miner to add the new block to the blockchain.— Chris McCoy (@chrisamccoy) September 25, 2018
3/They also assume PoS blockchains use the "longest chain rule," similar to PoW.
4/ With these assumptions the aim is to isolate the incentive-driven threat.— Chris McCoy (@chrisamccoy) September 25, 2018
5/ Blockchain designs that are not leader-based or that do not use the "longest chain rule" don't fall into the same threat model.
6/ @storecoin's BlockFin consensus engine is leaderless -- there is no leader or delegate chosen to create new blocks. The consensus engine requires that all nodes validate and sign the blocks.— Chris McCoy (@chrisamccoy) September 25, 2018
7/ For their participation, all validators share the block reward for every block.
8/ This equitable incentive model ensures there is no $ benefit in deviating from the protocol.— Chris McCoy (@chrisamccoy) September 25, 2018
9/ This leaderless consensus eliminates any long-term tendency toward centralization. By addressing the centralization concerns in the design, BlockFin ensures true decentralization.
10/ In @storecoin's BlockFin BFT consensus algorithm, the incoming transactions are assembled into pre-created blocks that are later validated and signed by all validators.— Chris McCoy (@chrisamccoy) September 25, 2018
11/ This avoids chain forks, so the longest chain rule doesn't apply.
12/ Together, these two properties discourage temptations to deviate from the protocol rules.— Chris McCoy (@chrisamccoy) September 25, 2018
13/ So, what could go wrong with such a design?!
14/ Block validation progress requires > 2/3 of validators to sign the blocks, so malicious validators may delay signing the blocks by going offline for extended periods of time.— Chris McCoy (@chrisamccoy) September 25, 2018
15/ But, unless > 1/3 of validators collude and coordinate their attack, the block validation progresses well. The way BlockFin validation is designed, the whole network and any external observers know who is not signing the blocks.— Chris McCoy (@chrisamccoy) September 25, 2018
16/ This is because the assembled blocks are in pending state with ~2/3 validator signatures, so all observers know the current state of block validation progress. BlockFin addresses this concern in a novel way, but that discussion is for another day!— Chris McCoy (@chrisamccoy) September 25, 2018
17/ Decentralization (security) can't be achieved with technology alone. We believe that economics and on-chain governance must bear equal responsibilities. @storecoin's Dynamic Proof-of-Stake protocol, which uses BlockFin as its "technology" foundation, will try to achieve this. pic.twitter.com/mohE5ajFw1— Chris McCoy (@chrisamccoy) September 25, 2018
KYC/AML checks are required for securities law compliance. This will be a Reg D and Reg S global offering.
Nothing herein is intended to be an offer to sell or solicitation of offer to buy, Storecoin tokens or rights to receive Storecoin tokens in the future. In the event that Storecoin conducts an offering of Storecoin tokens (or rights to receive Storecoin tokens in the future), Storecoin will do so in compliance with all applicable laws which may include the Securities Act of 1933 and the rules and regulations promulgated thereunder, as well as applicable state and foreign law. Any offering for sale to US Persons in a regulated transaction will be pursuant to a registration statement qualified by the Securities and Exchange Commission, or an applicable exemption from the registration requirements.